1. What is Percentage Pay Increase?

The percentage pay increase measures how much a salary or wage has grown compared to its previous amount. It's a common metric used in salary negotiations, performance reviews, and financial planning.

2. How Does the Calculator Work?

The calculator uses the percentage increase formula:

Where:

• New Pay — Current or proposed salary/wage amount
• Old Pay — Previous salary/wage amount

Explanation: The formula calculates the relative change between two pay amounts, expressed as a percentage of the original amount.

3. Importance of Pay Increase Calculation

Details: Understanding pay increases helps employees evaluate job offers, negotiate salaries, and track career progression. For employers, it's essential for budgeting and compensation planning.

4. Using the Calculator

Tips: Enter both old and new pay amounts in the same currency. The calculator works with any currency as long as both values are in the same unit.

5. Frequently Asked Questions (FAQ)

Q1: What's considered a good pay increase percentage?
A: Typically, 3-5% is standard for annual cost-of-living adjustments, while 10%+ may indicate a promotion or significant role change.

Q2: How does this differ from percentage point increase?
A: Percentage increase is relative to the original amount, while percentage points refer to absolute differences between percentages.

Q3: Should I include bonuses in the calculation?
A: For base salary comparisons, exclude bonuses. For total compensation comparisons, include all earnings.

Q4: How do I calculate the equivalent annual increase?
A: If you know the time period, adjust the percentage to an annual rate using compound interest principles.

Q5: What if my pay decreased?
A: The calculator will show a negative percentage, indicating a pay reduction rather than an increase.